GE Aerospace (NYSE:GE)

The quarterly financial data reveals distinct patterns and notable changes over the observed periods. Analysis of key ratios uncovers insights about profitability and financial structure on a quarterly basis.

Return on Assets (ROA)

The ROA displays considerable volatility initially, with a notable presence of missing data in early 2020. Starting from the first positive reported value of 2.25% in December 2020, the ratio declines steadily into negative territory, reaching its lowest points between March 2022 and December 2022, with figures hovering around -3.28% to -2.38%. A significant recovery begins in early 2023, peaking at around 6.45% in September 2023. Following this peak, ROA moderates slightly but remains positive and robust through to June 2025, consistently above 5%, indicating an improving efficiency in utilizing assets to generate profit.

Financial Leverage

The leverage ratio begins relatively high around 7.4 in the first quarter of 2020 and remains above 7.0 through mid-2021, indicating a heavily leveraged position early on. A marked reduction occurs in late 2021, dropping below 5.0 by December 2021. Subsequently, leverage trends upward again, oscillating between approximately 5.1 and 6.7 from 2022 onwards. This pattern suggests periods of deleveraging followed by incremental increases in the use of debt financing. As of mid-2025, leverage modestly increases to around 6.55, indicative of sustained reliance on financial leverage but still below the early 2020 levels.

Return on Equity (ROE)

ROE data is absent in early 2020 but emerges at 16.04% in December 2020 before plummeting into deeply negative values through 2021 and much of 2022, reaching an adverse low of -18.56% in December 2022. This drop corresponds with the negative ROA trend, reflecting poor profitability and possible operational challenges during this period. Starting from early 2023, ROE demonstrates a strong rebound, surging to over 35% by the last quarter of 2023 and maintaining a consistently high level near or above 30% through mid-2025. Such improvements underscore significant growth in shareholder returns and overall equity profitability following a period of distress.

Overall, the financial ratios indicate a cycle of difficulty marked by declining asset returns and negative equity returns through late 2021 and 2022, accompanied by deleveraging efforts. This is followed by a phase of pronounced operational recovery improving profitability metrics considerably through 2023 and sustained through 2025. The leverage ratio's upward trend in recent periods suggests a renewed but controlled use of debt, which could be supporting enhanced returns to equity holders.

The analysis of the financial ratios over the reported periods reveals several notable trends in profitability, efficiency, and leverage metrics.

Net Profit Margin

The net profit margin showed significant volatility initially, with values turning negative from March 2021 through December 2022. This suggests periods of operational challenges or increased costs adversely affecting profitability. Starting from the first quarter of 2023, a marked recovery is observed, as margins improve substantially and remain positive, reaching a peak of 20.43% by June 2025. This trend indicates a strong turnaround in the company’s ability to generate profit from revenue.

Asset Turnover

The asset turnover ratio exhibits a generally modest upward trajectory with some fluctuations. Initial values around 0.29 in 2020 rise gradually, peaking near 0.43 in the latter part of 2023. However, post-2023, a slight decline with some intermittent periods of stability is noted, falling back to approximately 0.30 by mid-2025. This pattern suggests moderate improvements in asset utilization efficiency through 2023, followed by stabilization and minor regression in subsequent quarters.

Financial Leverage

Financial leverage ratios start at a relatively high level above 7.4 in early 2020, showing a decreasing trend during 2021 as the ratio dips below 5. This indicates a possible reduction in debt relative to equity or an increase in equity base at that time. However, from early 2022 onward, financial leverage trend reverses, consistently increasing with some volatility to levels between 5.8 and 6.6, suggesting renewed reliance on debt financing or changes in the company’s capital structure.

Return on Equity (ROE)

Return on equity mirrors the net profit margin trend, starting with negative values from early 2021 through most of 2022, indicating losses or poor profitability relative to shareholder equity during that period. From 2023 onward, ROE improves sharply, reaching above 40% by mid-2025. This sharp increase reflects enhanced profitability and effective use of equity, indicative of a successful operational turnaround and possibly an optimization of financial leverage alongside improved net margins.

Overall, the data indicate that the entity experienced financial difficulties and returns below expectations during 2021 and 2022. Subsequently, there has been a substantial recovery in profitability and return on equity, supported initially by improving asset utilization and a more balanced leverage position. The recent financial performance suggests stronger competitive positioning and operational efficiency, although the asset turnover and financial leverage metrics imply ongoing adjustments in asset management and financing strategies.

The analysis of the quarterly financial ratios over the covered periods reveals several notable trends in profitability, efficiency, and leverage metrics.

Tax Burden

The tax burden ratio displays variability with intermittent missing data in earlier periods. Starting around March 2023, the ratio stabilizes below 1, indicating effective tax management or favorable tax circumstances. The ratio gradually declines from 0.94 in mid-2023 to a low of 0.76 in mid-2024 before slightly recovering to the mid-0.80s by mid-2025. This trend suggests a general reduction in tax expense relative to pre-tax earnings over recent quarters.

Interest Burden

This ratio exhibits substantial fluctuations in the early part of the timeline, including negative values suggesting periods of financial stress or unusual interest costs around late 2020. From early 2023 onwards, there is a clear improvement with ratios consistently above 0.8 and trending upwards towards 0.9 by mid-2025. This pattern implies strengthened operating income relative to interest expenses, indicating improved interest coverage and possibly better financing conditions.

EBIT Margin

Operating profitability shows a marked recovery. Initial periods reflect negative margins, with the lowest points around late 2020 and early 2021, indicating operational challenges or revenue declines against fixed costs. However, from early 2023, EBIT margins increase substantially, steadily rising from approximately 3% to nearly 26% by late 2025. This demonstrates enhanced operational efficiency, revenue growth, or cost control contributing to robust earnings before interest and taxes.

Asset Turnover

Operating efficiency measured by asset turnover reveals relative stability with minor variations. The ratio generally ranges between 0.29 and 0.43, peaking around late 2023. Although there is a slight decline noted in some periods during 2024 and 2025, the ratio does not show a persistent downward or upward trend, suggesting consistent asset utilization levels over time.

Financial Leverage

Leverage ratios decrease steadily from 7.43 in early 2020 to a low of 4.93 by late 2021, indicating de-leveraging or reduction in debt relative to equity during that period. From 2022 onward, leverage climbs again, fluctuating between approximately 5 and 6.7, indicating an increased reliance on debt financing or equity changes. This suggests a strategic adjustment in capital structure possibly to support growth or capital investments.

Return on Equity (ROE)

ROE follows a trajectory similar to EBIT margin but with greater volatility. The early period shows significant negative returns, bottoming at nearly -18.5% around late 2021, reflecting losses or impaired profitability. Post-2022, ROE improves dramatically, turning positive and escalating to over 40% by mid-2025. This indicates a strong recovery in net profitability and effective use of equity capital, which may reflect operational improvements, financial leverage effects, or other strategic enhancements.

Overall, the data reveals a company transitioning from periods of financial difficulty in 2020-2021, characterized by negative profitability and high leverage, to substantially improved operational performance and profitability by 2023 onward. The steady improvement in EBIT margin and ROE, combined with better interest burden ratios and moderate asset turnover stability, points to enhanced financial health and operational effectiveness. The increased financial leverage in recent periods suggests confidence in future growth prospects supported by debt financing.

The financial data reveals several noteworthy trends in the quarterly performance metrics over the analyzed periods.

Net Profit Margin

The net profit margin exhibits significant volatility in the earlier periods, with negative values from mid-2020 through the end of 2022, reaching lows close to -9.17%. However, beginning in early 2023, there is a clear and sustained recovery, with margins turning positive and progressively increasing. By the end of 2024 and into mid-2025, the margin achieves robust levels exceeding 18%, peaking at 20.43%. This suggests a recovery and strengthening in profitability after a prolonged period of losses.

Asset Turnover

Asset turnover demonstrates relative stability throughout the periods, with slight fluctuations. Initially, values hover around 0.29 to 0.3 before increasing gradually into 2022 and 2023, reaching peaks near 0.43. Subsequent periods show some variability, with values declining to approximately 0.29 towards mid-2025. Overall, the metric indicates moderate efficiency in utilizing assets to generate revenue, with a mild improvement followed by a slight decline in the latest quarters.

Return on Assets (ROA)

ROA follows a pattern similar to net profit margin, reflecting initial negative or near-zero returns through 2020 to 2022, including a trough near -3.28%. Starting in 2023, ROA transitions to positive territory and progressively improves, achieving values exceeding 6% in certain quarters. This upward trend suggests enhanced overall profitability relative to asset base, reinforcing the recovery in earnings efficiency observed in net profit margin.

In summary, the data signals a period of financial distress through 2020-2022, with negative profit margins and returns. This stage is followed by a marked recovery beginning in early 2023, characterized by improving profitability and asset utilization efficiency. Despite some fluctuations in asset turnover, the upward trends in net profit margin and ROA highlight an improving financial performance trajectory towards the latest quarters.

The financial ratios exhibit notable fluctuations and gradual trends over the observed periods. Analysis of these metrics reveals insights into the company's operational efficiency, profitability, and financial burden management.

Tax Burden

The tax burden ratio data is partially missing in early periods but where available, it fluctuates significantly. Initially recorded at 1.09, it sharply declines to 0.32 in early 2023, indicating a temporary reduction in tax-related expenses or benefits. Following this dip, the ratio steadily recovers and stabilizes slightly below 1.0, fluctuating between 0.76 and 0.94 in recent quarters up to mid-2025. This pattern suggests improved tax management or changing tax obligations over time, contributing to a more normalized tax impact on earnings.

Interest Burden

The interest burden ratio also presents incomplete data but shows a wide range from negative values (notably -0.1) to positive values approaching 0.91 by mid-2025. The negative value may reflect unusual income or financial arrangements affecting interest expenses early in the timeline. Subsequently, the ratio displays a positive and upward trend, moving from 0.3 in early 2023 to around 0.9 by 2025, indicating enhanced earnings before interest and taxes relative to earnings before taxes. This improvement points to effective interest expense management or reduced financial leverage risks.

EBIT Margin

There is significant volatility in the EBIT margin across the periods. From a positive margin of 11.64% in early 2020, the company experienced negative margins for several quarters through 2021, with the lowest points nearing -7%. Starting in 2023, the margin markedly improves, ascending steadily from 3.14% to a peak of 25.98% in late 2024 and maintaining around 25% through mid-2025. This rebound evidences a substantial recovery and strengthening of operational profitability driven by either cost efficiencies, revenue growth, or both.

Asset Turnover

The asset turnover ratio shows a generally stable trend with minor fluctuations. Early values around 0.29 rise gradually to approximately 0.4 by late 2021 and early 2022, indicating slightly improved efficiency in generating revenue from assets. Subsequently, ratios dip again near 0.29 by late 2024 and early 2025. This pattern illustrates relatively consistent asset utilization with only moderate improvements or declines, suggesting the company's asset base is utilized at a steady but not markedly improving efficiency.

Return on Assets (ROA)

The ROA mirrors the volatility observed in EBIT margin, with early negative values from 2020 through 2021, reaching lows near -3.3%. Starting in 2023, ROA turns positive and trends upward, increasing from about 0.12% to above 6% by mid-2025. This upward trajectory highlights an enhancement in the company’s ability to generate net earnings from its asset base, consistent with recovering profitability and operational improvements.

Overall, the data reveals a period of financial difficulty or operational inefficiencies in 2020 and 2021 as evidenced by negative profitability measures and variable tax and interest burdens. A clear turnaround begins in 2023, with considerable improvements in EBIT margin and ROA, alongside stabilizing interest and tax ratios. Asset turnover remains relatively unchanged, indicating that gains in profitability are likely driven more by increased margins and cost management rather than enhanced asset use efficiency.

The financial data reveals notable fluctuations and trends in profitability and burden ratios over the observed periods. Examination of the Tax Burden ratio indicates considerable variability, with an initial value of 1.09 observed at the start of the series, followed by periods of missing data. More recent values from early 2023 through mid-2025 display a general stabilization in the range of approximately 0.76 to 0.94, suggesting a reduction in tax impact relative to earlier volatility.

The Interest Burden ratio presents a more erratic pattern with missing and negative values in the earlier periods. Notably, a negative value appears, which could indicate extraordinary items or accounting adjustments affecting interest expense or earnings before interest and taxes. From 2023 onward, the Interest Burden exhibits an improving trend, increasing from 0.3 up to about 0.91 by mid-2025, indicating enhanced operational earnings relative to interest costs in more recent periods.

Profitability margins underline a challenging period initially, with EBIT Margin and Net Profit Margin both recording several negative values between early 2020 and late 2021. EBIT Margin starts off at 11.64% in early 2020 but swiftly declines into negative territory, bottoming out at -6.94% by early 2021 and remaining subdued through late 2021 and 2022. From 2023 onwards, there is a marked and sustained recovery in EBIT Margin, progressively increasing from 3.14% to nearly 26% by late 2025, signaling significant operational improvement.

Similarly, the Net Profit Margin mirrors the EBIT trend with negative margins persisting through the 2020-2022 period. However, after a marginal positive turn in early 2023 (0.31%), the margin improves steadily to surpass 20% by late 2025. This progression indicates not only operational profitability gains but also potential enhancements in tax and interest efficiency that contribute positively to net earnings.

Overall, the data reflects an initial phase marked by financial strain and operational challenges, with substantial negative margins and unstable burden ratios. This is followed by a consistent recovery and improvement in all key profitability metrics post-2022, culminating in robust earnings margins and improved burden ratios by mid-2025. The trends suggest successful management interventions or favorable market conditions leading to enhanced financial health and profitability in the later periods.

Tax Burden Ratio

Initially high and volatile, stabilizes around 0.76 to 0.94 from 2023 onward.

Interest Burden Ratio

Erratic with negative early values, improves steadily after 2023 approaching 0.91.

EBIT Margin

Declines into negative territory during 2020–2022, sharp recovery post-2023 reaching nearly 26% by 2025.

Net Profit Margin

Follows EBIT margin trend with initial negative values, turning positive and improving beyond 20% by late 2025.